On the resale market the buyer pays real estate transfer tax (porez na promet nepokretnosti). It is governed by the 2013 Zakon o porezu na promet nepokretnosti (Real Estate Transfer Tax Act, Sl. list CG 36/2013), as amended in 2023 and 2026. The essentials:
Below we go through each point in detail, with calculations and references to the articles of the law.
The new wording of Article 11 of the law was introduced by amendments published in Sl. list CG No. 28/2023 of 10 March 2023. The amendments took effect on 1 January 2024. The scale works in steps: each higher rate applies only to the part of the value above the threshold, while the amount for the lower bands is fixed.
| Market value of the property | How the tax is calculated |
|---|---|
| up to €150,000 | 3% of the value |
| €150,000.01 to €500,000 | €4,500 + 5% of the amount above €150,000 |
| from €500,000.01 | €22,000 + 6% of the amount above €500,000 |
The fixed amounts in the scale are consistent with each other: €4,500 is 3% of 150,000, and €22,000 is 4,500 plus 5% of 350,000 (the difference between 500,000 and 150,000). So the tax does not jump at the band boundaries: the tax on an apartment costing €150,001 is only 5 cents higher than on one costing €150,000.
We calculated five typical cases with a script and compared the results with the “old” 3%:
| Market value | Tax under the 2024 scale | Effective rate | At a flat 3% | Difference |
|---|---|---|---|---|
| €80,000 | €2,400 | 3.0% | €2,400 | €0 |
| €150,000 | €4,500 | 3.0% | €4,500 | €0 |
| €250,000 | €9,500 | 3.8% | €7,500 | +€2,000 |
| €500,000 | €22,000 | 4.4% | €15,000 | +€7,000 |
| €800,000 | €40,000 | 5.0% | €24,000 | +€16,000 |
How the figures were obtained. For €250,000: 4,500 + 5% × (250,000 − 150,000) = 4,500 + 5,000 = €9,500. For €800,000: 22,000 + 6% × (800,000 − 500,000) = 22,000 + 18,000 = €40,000. The effective rate, i.e. the tax divided by the value, rises smoothly and stays below 6% even for expensive properties.
The practical takeaway: for a studio or a small apartment up to €150,000 nothing has changed. For a €250,000 family apartment the tax budget has grown by €2,000, and for an €800,000 villa by €16,000, compared with what outdated articles and calculators promise.
Transitional rule: if the buyer filed the tax return before the amendments took effect, the tax is calculated at the former 3% rate (new Article 26b, added by the same amendment 28/2023). This no longer matters for 2026 transactions, but it explains why documents from 2023 show a flat rate.
Since late 2022 the Real Estate Transfer Tax Act has been amended four times. Below are all the amendments we found in the official Službeni list register, in chronological order:
The rates have not changed since 2024: neither amendment 33/2026 nor amendment 132/2026 touches Article 11. None of the versions we found introduced a separate rate for non-residents or foreigners. We found no new transfer tax act replacing the 2013 law, nor any published drafts that would change the scale.
To give a sense of scale, take the municipality of Bar, where our complex is located. According to the preliminary report on budget revenue for 2025, transfer tax brought the municipality €2,948,055.50 against a plan of €2,500,000 (117.9% of plan). Since the law allocates 80% of the tax to the municipality, this is its share, not the full amount collected in Bar.
Article 9 of the law defines the base as the market value of the property at the time of acquisition. For an acquisition for consideration, the base is everything the buyer gave the seller: money, goods, services, and the seller's debts taken over by the buyer. In an exchange, each party pays tax on the market value of what it received. When a share is purchased, the base is calculated separately for each share.
The key provision is Article 10. If the contract price is below market value or not stated at all, the market value is determined by the municipal tax administration. The valuation is carried out by an authorised official, who compares the property with similar ones sold in the same area at roughly the same time. If no comparable data are available, the tax authority appoints a licensed valuer. For public auctions and sales in bankruptcy, the base is all payments made by the buyer for the property.
This has three practical consequences:
What to do if the valuation is higher than the price. The tax authority issues the assessment under the rules of the law governing tax procedure, to which Article 17 of the Real Estate Transfer Tax Act refers. The transfer tax act itself contains no separate procedure for appealing a valuation: on all other matters, Article 20 refers to the same tax procedure law. We have not verified in the available sources the deadlines and appeal bodies for a tax administered by a municipality. So before signing the contract, it is worth asking a notary or a local lawyer how your municipality's tax administration values similar properties. That way any surprises come to light in advance rather than after the transaction.
A separate point on valuation for residence permits: since 17 January 2026 (amendments to the Law on Foreigners, Zakon o strancima, Sl. list CG 3/2026), the €150,000 threshold for a residence permit through property is assessed on the tax base stated in the transfer tax decision, not on the contract price. How the value is evidenced when buying a new build with VAT, where no transfer tax is charged, the law does not expressly say: check this with a notary or lawyer before signing the contract. We covered residence permits in detail in our article on getting a residence permit through property in Montenegro.
Under Article 7, the tax is paid by the acquirer of the property. In an exchange each party becomes a taxpayer, and when shares in co-ownership are bought, each buyer pays on their own share. Article 8 covers special cases: on inheritance the heir pays, on a gift or other gratuitous transfer the recipient pays, and under a lifelong maintenance contract the person who has undertaken the maintenance and receives the property pays.
The transfer tax act does not provide for joint and several liability of the seller if the buyer fails to pay: we found no such provision in the text of the law or its amendments. We have not checked whether other grounds for joint and several liability exist under the general tax rules.
Can the parties agree that the seller pays the tax? The parties are free to agree who actually bears this cost: for example, the seller may lower the price or reimburse the tax. But as far as the tax authority is concerned, the obligation remains with the buyer. The phrase “tax included in the price” in a listing means an agreement on reimbursement, not a transfer of the tax liability. If there is such an agreement, it should be spelled out in the contract.
Foreigners and non-residents. Article 3 establishes equal treatment for domestic and foreign persons unless an international treaty provides otherwise. The law has no higher rates for foreigners, non-residents or buyers of a second home. The difference lies in the reliefs: the first-home exemption is available only to adult Montenegrin citizens resident in the country (more in the section on exemptions). A foreigner buying their first apartment in Montenegro pays the tax in full.
We explained which documents on the property and the seller to check before paying a deposit in our article on how to check a property in Montenegro.
Here the law differs from what buyers' guides often say: “the tax is assessed after registration in the cadastre, and the notice arrives a few months later”. The text of the law sets out a different procedure.
Penalties. For an individual who fails to calculate the tax, file the return within the 15-day deadline or pay the tax on filing, the law provides for a fine of €100 to €1,000 (Article 23). For legal entities the fine is €1,000 to €10,000, for the responsible person in a company €200 to €1,000, and for a sole trader €800 to €6,000 (Article 22). These amounts are taken from the 2013 text of the law; we found no changes to these articles in the 2023–2026 amendments. In addition to the fine, interest is charged on late tax under the general tax rules, but we have not confirmed the rate for a municipally administered tax in a primary source.
Secondary sources describe another practice: the tax authority issues a decision (rješenje), and the tax must be paid within 15 days of its delivery. This may apply where the tax authority values the property itself. The law's basic model is different, a self-assessed return within 15 days, and that is what we recommend planning around. If you are leaving the country right after the transaction, agree with a notary or lawyer who will file the return and receive post from the tax authority.
This is the main difference between buying a new build from the developer and buying on the resale market. Article 6 of the Real Estate Transfer Tax Act states plainly that the acquisition of newly built properties subject to VAT is not a taxable transfer. Since 1 April 2026 building land subject to VAT has been added to them (amendment 33/2026).
What the VAT Act says. The current VAT Act exempts supplies of real estate from VAT, except for the first transfer of ownership or of the right of disposal of a newly built property (Article 27, point 2). Since 1 April 2026 building land for which a building permit has been issued has also fallen outside the exemption (see below). So the first sale of an apartment in a new building by a VAT-registered seller is subject to VAT, while all subsequent resales of that apartment are exempt from VAT and subject to transfer tax.
Rate. The standard VAT rate in Montenegro is 21% (Article 24 of the VAT Act). Reduced rates of 7% and 15% apply to food, medicines, books, hotel accommodation, catering services and a number of other items. Housing is not on these lists: neither in the current law (according to the version on paragraf.me, current as of 31 March 2021, and the 2026 overview of rates by the accounting firm Ekonomik) nor in the new 2026 VAT Act (Articles 64 and 65). The sources we found contain neither a zero rate nor a preferential rate for a first apartment.
How VAT shows up in the price. The developer charges VAT as part of the apartment price; the buyer makes no separate payment to the tax authority. If the contract states that the price of €200,000 includes VAT, the tax within the price is 200,000 × 21 / 121 = €34,710.74, and the value excluding VAT is €165,289.26. A private buyer cannot reclaim this VAT, as they are the end consumer. To avoid disputes, check that the contract says “cijena sa uključenim PDV-om” (price including VAT) rather than a price “plus VAT”.
The total cost for a new-build buyer is made up as follows: the contract price (already including VAT) plus the notary, registration in the cadastre and, if needed, translation and a lawyer. There is no transfer tax in this arrangement. For comparison, a resale apartment with a market value of €200,000 would require transfer tax of €7,000 on top of the price (4,500 + 5% × 50,000).
The 2026 rules for land. Amendments to the VAT Act published in Sl. list CG No. 12/2026 of 6 February 2026 treat building land for which a building permit has been issued as a VAT-taxable supply from 1 April 2026. According to a KPMG overview of 17 March 2026, the new rule does not apply to advance payments made before 1 April 2026. Land without a building permit remains outside VAT and is subject to transfer tax. For an apartment buyer this matters indirectly: developers buying land now pay VAT, and the business portal Investitor wrote back in November 2025, before the amendments were adopted, that this could affect apartment prices. We do not give specific estimates, because they are not supported by statistics.
The new VAT Act. On 9 July 2026 parliament adopted a new VAT Act (Sl. list CG 104/2026), which will replace the current law (Sl. list RCG 65/2001). The law was published on 17 July and entered into force on 25 July 2026, but according to the newspaper Dan of 9 July 2026, it will start to apply from the day Montenegro joins the European Union. Until then the previous law applies. The new law keeps the same logic: supplies of real estate are exempt from VAT, except for the first transfer of a newly built property and the sale of building land (Article 68, paragraph 1, points 3 and 4). The standard rate remains 21%.
When an apartment in a new building no longer counts as a new-build purchase. If someone has already bought the apartment from the developer and is now reselling it, this is a second transfer: no VAT is charged, and the buyer pays transfer tax on the scale. We did not find in primary sources how the tax authority treats the assignment of a contract concluded with the developer before the building is put into use. If you are not buying the apartment directly from the developer, check the structure with a notary before signing.
The law contains three groups of exemptions: general (Article 12), corporate (Article 13) and for inheritance and gifts (Article 14). We summarise them taking amendment 132/2026 into account.
First home (Article 12, paragraph 1, point 4). The exemption covers adult Montenegrin citizens resident in Montenegro who are acquiring a house or apartment for the first time to meet their housing needs and do not own any other home in the country. It applies up to 20 m² of floor area per household member. The household is defined in paragraph 2 of Article 12: it comprises persons with the same residential address as the buyer who live with them as one family and share a common budget, namely a spouse or same-sex partner, the children (including adopted children) of the buyer and of the buyer's spouse or partner, and the parents (including adoptive parents) of the buyer and of the buyer's spouse or partner. Amendment 132/2026 added the same-sex partner and their children and parents to this definition from 10 September 2026; the rest of this circle of persons was already in the law. Foreigners cannot use this relief even if they hold a residence permit, because the condition is framed in terms of Montenegrin citizenship. The law does not explain in detail how the exempt portion is calculated when the apartment exceeds the limit, and we found no calculation method in official guidance.
Other general exemptions (Article 12). State bodies, local government bodies, public institutions and funds, humanitarian organisations; diplomatic and consular missions on a reciprocal basis and international organisations; restitution of confiscated property and acquisition of land under agricultural policy measures; acquisition under a lifelong maintenance contract where the acquirer is a first-order heir; division of co-owned property within one's own share; non-profit organisations for their statutory activities; expropriation; banks that acquired ownership under a fiduciary security arrangement or a mortgage, if they sell the property within three years.
Companies (Article 13). No tax is payable when real estate is contributed to share capital or to increase it, or on mergers, absorptions and divisions of companies. This exemption does not make buying an apartment through a company cheaper: if a company buys a property from a third party, the tax is paid on the same scale.
Inheritance and gifts (Article 14). The exemption covers first-order heirs, the spouse or same-sex partner and the parents of the deceased. For gifts, first-order donees and the donor's spouse or partner are exempt. Second-order heirs and donees are exempt under special conditions: farmers, for agricultural property, if they lived in one household with the deceased for at least three years, and any second-order heir, for one apartment, if they lived in one household with the deceased for at least a year. If a farmer changes occupation within five years, they must notify the tax authority within 15 days and pay the tax on the standard scale. Also exempt are former spouses and former same-sex partners dividing joint property on divorce or the end of the partnership; a donee, for property assigned to them in probate proceedings that they would have inherited had the heir-donor renounced the inheritance; the state as statutory heir; and non-profit organisations.
Inheritances and gifts are subject to the same transfer tax (Article 4 of the law lists them among the taxable forms of transfer). So for distant relatives and unrelated persons the scale applies even to gratuitous transfers. We have a separate guide to inheriting an apartment in Montenegro (using Serbian citizens as an example).
Tax is not the only cost. Below are the budget items for which we found confirmed figures, and those where there are only rough guides.
Notary. In Montenegro a property sale contract is drawn up by a notary as a notarial deed (notarski zapis), and the notary's fee is set by a tariff rather than as a percentage of the price. Under the new notarial tariff (Tarifa o naknadama za rad i naknadama troškova notara, the Tariff of Notarial Fees and Expenses, Sl. list CG 49/2026 of 9 April 2026; in force from the day of publication, replacing the 2012 tariff), the fee for a notarial deed depends on the value of the transaction:
| Transaction value | Notary's fee |
|---|---|
| up to €19,999 | €180 |
| €20,000–€39,999 | €250 |
| €40,000–€59,999 | €350 |
| €60,000–€79,999 | €420 |
| €80,000–€119,999 | €480 |
| from €120,000 | €480 + €13 for each €15,000 or part thereof above €120,000, up to a maximum of €8,000 |
On this scale, a notary charges €480 for an €80,000 transaction, €558 for €200,000 and €597 for €250,000. Note that amounts under the previous tariff (Sl. list CG 6/2012), which is no longer in force, can still be found online. The amounts in the table exclude VAT: under Article 12 of the tariff, the notary must additionally charge the applicable VAT, fees and other charges. At the standard 21% rate, a fee of €597 becomes about €722.
Registration in the cadastre. Ownership passes to the buyer only once it is registered in the real estate cadastre (Katastar). For preparing and filing the cadastre registration application, the notary charges €15 plus VAT under the tariff (tariff item 19). We did not find the official amount of the state cadastre fee: secondary sources give a guide figure of €15–20, and that is what you should budget, marked as approximate.
Lawyer. Using a lawyer for the transaction is not mandatory. Since 1 January 2026 a new attorneys' tariff has applied (Advokatska tarifa, Sl. list CG 132/2025). It has no separate item for “assistance with a property purchase”: the fee depends on the type of work and the value of the matter, and by agreement with the client anything from 50% to five times the tariff amount is permitted. A specific figure for full support of a transaction cannot be derived from the tariff, so discuss it with the lawyer in advance.
Translation and power of attorney. If the buyer does not speak Montenegrin, a sworn interpreter is needed at the signing before the notary. If the buyer acts through a representative, a power of attorney executed abroad must be apostilled (unless your country has an agreement with Montenegro waiving legalisation) and translated. We found no confirmed rates for translation and apostille for Montenegrin transactions. Translators' prices vary, so it is best to request quotes in advance.
Tax number. According to estate agency sources, the buyer needs a Montenegrin tax identification number (PIB) for the transaction. We did not find an official list of documents for buyers on gov.me, so check the required documents with the notary.
A budget guide for a resale apartment with a market value of €250,000: transfer tax €9,500; notary €597 plus 21% VAT, i.e. about €722; filing the cadastre application through the notary €15 plus VAT (about €18); state cadastre fee about €15–20; plus translation and a lawyer as agreed. In total about €10,260 excluding interpreter and lawyer fees, or roughly 4.1% on top of the price.
After registration, the owner pays property tax (porez na nepokretnosti) every year. This is a local tax: the municipality chooses the rate within the limits set by law and also assesses and collects the tax. The 2019 Zakon o porezu na nepokretnosti (Property Tax Act, Sl. list CG 25/2019, as amended by 49/2022, 152/2022, 118/2025 and 133/2025) sets the framework within which the municipality chooses the rate: a general range of 0.25–1.00% of market value, and 0.3–1.5% for a second home (sekundarni stambeni objekat, i.e. not a place of permanent residence). The ranges are given according to the 2019 text. The 2025 amendments did not change them; we did not find the texts of the 2022 amendments.
The law was amended twice in 2025. Amendments adopted by parliament on 30 July 2025 and again on 13 October 2025, after being returned by the President, removed “buildings under construction” from taxation and abolished the higher 0.3–5% rate for undeveloped building land (Sl. list CG 118/2025, published 16 October 2025). According to investitor.me of 16 October 2025, the Constitutional Court found unconstitutional the provisions on taxing buildings under construction and “other buildings” and the 0.3–5% rate for undeveloped building land. Parliament adopted another minor amendment on 12 November 2025. As far as we can tell from the texts, these changes did not affect the rates for ordinary apartments.
The Bar example. In the 2019 draft decision of the Municipality of Bar on property tax (Predlog odluke; we did not find the adopted text), the rate for a primary home is 0.26%, for a second home 0.60% and for building land 0.30%. The reduction for the owner's family applies only to the apartment where they live permanently. The owner files a tax return within 30 days of acquisition: this deadline is set by the law itself (Article 16 of Law 25/2019) and is the same for all municipalities. The municipality sets the base in euros per square metre. According to Primorski of 11 April 2025, for 2025 it was reduced from the original €2,305.00 to €1,693.75 (the article does not state the unit; judging by the text, this is the base per square metre, calculated from the average market price according to Monstat data). We have not checked the current version of the decision or the base for 2026, so confirm them with the municipality before calculating.
Order of magnitude: if a 50 m² apartment in Bar is taxed as a second home at 0.60% with a base of €1,693.75 per m² (2025 data), the tax would be about €508 a year. This is an illustration, not a calculation for a specific property, because the base takes coefficients into account. In Bar's 2019 draft decision these are a zone coefficient (from 0.5 to 1.4), a quality coefficient and a reduction of 1% for each year of the building's age, up to a maximum of 60%. For an owner-occupied home, the tax is reduced by 20% plus a further 10% for each household member, by no more than 50% in total (Article 12 of the law).
Separate rules apply to building management and residents' mandatory charges; we covered them in our article on who manages a residential building in Montenegro.
Both taxes are governed by the Zakon o porezu na dohodak fizičkih lica (Personal Income Tax Act). Below is a summary based on the consolidated text published by the government on gov.me (with amendments up to Sl. list CG 152/2022). The law has since been amended several more times (Sl. list CG 88/2024, 133/2025, 160/2025 and an amendment adopted on 14 May 2026). The 133/2025 and 2026 amendments that we read do not touch the rules on rental income or capital gains, and the 2024 amendments, according to KPMG's overview, concern other types of income. We have not read the text of amendment 160/2025.
Rental income. The rate is 15%. If expenses are not documented, standardised expenses of 30% of income are deducted, so tax is paid on 70% of the rent. For letting rooms, apartments and houses to tourists the allowance is higher: 50% if the tourist tax has been paid, and 70% if there is a contract with a travel agency or the local tourism organisation and average occupancy is at least 60 days a year. An example for a long-term let: €800 a month gives €9,600 a year, the taxable base is €6,720 and the tax is €1,008 a year. If the tenant is a company or sole trader, it withholds advance tax at 15% of the taxable income, i.e. the rent minus expenses, on each payment; if the tenant is an individual, the tax is paid on the basis of the annual return (Article 49a). Short-term letting to tourists also requires registration and payment of the tourist tax. We cover the practical side of letting in our guide on who is renting out your apartment while you are away.
Tax on resale. Capital gains from the sale of real estate are taxed at 15%. The gain is the difference between the sale price and the purchase price. The sale price is taken from the contract, less documented reconstruction and selling costs; if it is below market value, the tax authority determines the market value. The purchase price is indexed annually for growth in retail prices according to the statistical office. If it cannot be established, it is taken as 80% of the sale price. The tax is declared for the year, with the return filed by the end of April of the following year.
Capital gains tax exemptions (Article 37g):
The text of the law we found contains no exemption after a minimum holding period (for example, “after three years” or “after ten years”). We have not confirmed claims found online about such a period. A non-resident pays income tax on income earned in Montenegro (Article 4, paragraph 2 of the law) and files a return themselves for income on which no withholding at source applies (Article 43, paragraph 6). The law has no separate rate or exemption for non-residents, and the only-home exemption is tied to the place of residence. If you sell an apartment while living abroad, also take into account your own country's rules and the double taxation treaty.
If you are buying with a mortgage, read about rates and banks' requirements for non-residents in our article on mortgages in Montenegro for foreigners.
“Purchase tax in Montenegro is always 3%.” This is true only up to €150,000 and only for resale transactions. Since 1 January 2024 the 3/5/6% scale has applied. For a €250,000 apartment the difference from the “old” 3% is €2,000.
“The tax is based on the contract price.” By law it is based on market value. If the contract price is below market value, the municipal tax administration sets the value itself by comparing the property with similar transactions.
“A new-build buyer pays transfer tax.” Not if the developer sells the apartment with VAT: the first sale of a newly built property is subject to 21% VAT, which is included in the price, and no transfer tax is payable in that case (Article 6). When the next owner resells the same apartment, transfer tax does apply.
“The tax is assessed after registration in the cadastre, so wait for a letter.” The law requires the return to be filed and the tax paid within 15 days of the contract. An individual who misses the deadline faces a fine of €100 to €1,000.
“Transfer tax is administered by the national tax administration.” Since 2024 transfer tax has been administered by the tax administration of the municipality where the property is located.
“Foreigners pay more.” No. The rates are the same. The only difference is that the first-home relief is available only to adult Montenegrin citizens resident in the country.
“Tax is lower through a company.” There is no separate rate for companies. The exemption covers only contributions of real estate to capital and reorganisations, not purchases from a third party.
We deliberately left out anything we could not find in primary sources. These are the questions on which there are no data, or only secondary sources:
If you have found official guidance on any of these points, let us know and we will update the article.
Zen Gardens is a residential complex in Bar where apartments are sold by the developer, so if the sale is subject to VAT, the buyer pays VAT included in the price rather than transfer tax.
How much is the tax on buying an apartment in Montenegro in 2026?
On the resale market the buyer pays real estate transfer tax on the progressive scale in force since 1 January 2024: 3% up to €150,000, then €4,500 plus 5% of the amount above €150,000, and above €500,000, €22,000 plus 6% of the excess. For example, an apartment costing €250,000 is taxed at €9,500. When buying a new build from the developer, 21% VAT is included in the price instead of this tax.
Does a foreigner pay more than a citizen when buying property in Montenegro?
No. The law establishes equal treatment for domestic and foreign persons unless an international treaty provides otherwise; there are no separate rates for foreigners or non-residents. There is only one difference: the first-home exemption (up to 20 m² per household member) is available only to adult Montenegrin citizens resident in the country.
Is there an equivalent of stamp duty or the German Grunderwerbsteuer in Montenegro?
Yes, the real estate transfer tax (porez na promet nepokretnosti) plays that role. Like stamp duty or Grunderwerbsteuer, it is paid by the buyer when acquiring real estate, but the rate is progressive rather than flat: 3%, 5% and 6% by band. Since 2024 it has been collected and administered by the municipalities.
Who pays the transfer tax, the buyer or the seller?
By law the taxpayer is the acquirer, i.e. the buyer. In an exchange each party pays, on inheritance the heir pays, and on a gift the donee pays. The parties may agree that the seller reimburses the tax, but as far as the tax authority is concerned, the obligation remains with the buyer. The Real Estate Transfer Tax Act does not provide for joint and several liability of the seller.
Is the tax calculated on the contract price or on a valuation?
On the market value at the time of acquisition. The buyer states the contract price in the return, but if it is below market value or not stated, the municipal tax administration determines the market value based on comparable transactions in the same area or, if there are no data, through a licensed valuer.
Do I have to pay transfer tax when buying a new build?
No, if you are the first buyer of a newly built property from the developer and the sale is subject to VAT: the 21% VAT is included in the price, and under Article 6 of the law such an acquisition is not a taxable transfer. If you buy an apartment in a new building from a previous owner, that is already a resale, and transfer tax is payable on the scale.
What is the deadline for paying the tax?
The liability arises on the day the contract is concluded. The buyer calculates the tax in a return, files it with the municipal tax administration within 15 days and pays at the same time as filing. An individual who misses the deadline faces a fine of €100 to €1,000.
Can the tax on a purchase be lawfully reduced?
The rate cannot be reduced, and an understated contract price will not help: the tax will be calculated on market value. The lawful options are the exemptions provided by law: inheritance and gifts to first-order heirs and a spouse or partner (for inheritance, also parents), division of joint property between former spouses or partners on divorce, and a first home for Montenegrin citizens resident in the country. When buying a new build from the developer there is no transfer tax, but this is not a saving: 21% VAT is already built into the price. Buying through a company does not reduce the tax.